Home » OKEx » Cross-margin vs. fixed margin at okex.com explained


Trading on margin with high leverage is one of the most significant advantages of futures compared to trading a spot market. If you are only starting familiarising yourself with margin trading of futures contracts, I suggest you read this article first: Basics of margin trading Bitcoin futures.

Okex.com, being the most liquid inverse bitcoin futures platform, offers two margin trading modes: fixed margin and cross-margin. It is essential to understand the mechanics of these two modes before you start trading there.

In short, cross-margin mode uses your whole account equity balance as a margin, while fixed-margin can be fine-tuned for each position you hold and won’t drain your account equity if the price moves against you.

Fixed margin example

Your account equity is 1 BTC, and the price is at $5,000 BTC/USD. You open fixed margin position for ten $100 contracts with notional value of 0.2 BTC ($100*10 = $1,000 or 0.2 BTC). Now, if you’re in x10 leverage mode, this position will lock minimum margin required of 10% which is 0.02 BTC (0.02 * 10 = 0.2 BTC, hence x10 leverage with 10% margin), with x20 leverage minimum margin requirement would be 0.01 BTC (5% margin).

You now have one separate position in your account with minimum initial margin allocated to hold it. You can add margin to this position at any time, effectively, lowering your leverage, but you cannot deduct any margin lower than the minimum margin required of 10% or 5%.

Below is the example how a separate fixed-margin position looks:

okex.com fixed margin
Fixed margin position example (prices changed from real)

If the price moves against you to the point where the losses are nearing 90% or 80% of minimum margin requirement (x10 and x20 leverage respectively), your position will be automatically closed (liquidated) by the system to make sure that the winning side of the contract keeps getting paid. If you want to avoid liquidation, you should add margin to this position manually.

Cross-margin example

Unlike the fixed margin, cross-margin uses the total equity available in futures account as a margin to all your open positions.

Suppose you have the same 1 BTC balance in your futures account, and the price is again sitting at $5,000 BTC/USD. Your settings are in the cross-margin mode, and you open a 400 contracts position, which is worth $40,000 or 8 BTC of notional value ($40,000/$5,000 = 8 BTC).

With x10 leverage, 1/10th of 8 BTC will be locked to open this position, which is 0.8 BTC, but this is not the total margin you’re using here. Since your total equity is used as a margin, your 1 BTC is the overall margin, which makes your practical leverage x8 (8 BTC / 1 BTC = x8).

Now if the price moves against you, and losses “eat up” your equity to the point where it equals only 10% of initial margin required, your position will be automatically closed/liquidated by the okex trading engine.

Note that if you’re in the cross-margin mode, and have a separate position open in different contracts maturity timeframes, your equity will be used as a margin for all those positions at the same time.


Both, fixed margin, as well as the cross-margin, can be used to trade successfully. One mode is not better than the other but rather depends on your goals and your trading strategy. New traders would be better off with limiting their exposure with fixed margin, while more experienced will probably manage their exposure better with the cross-margin mode.

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